The division headquarters was initiated in January 1922 and established in the Army Building in Omaha, Nebraska, by Colonel William L. Luhn.

The bulk of the division was located east of the Rocky Mountains, with only the units of the 162nd Cavalry Brigade being west of the Continental Divide.

The tables of organization in the division remained unchanged until 1 July 1929, when the cavalry brigades' machine gun squadrons were deleted.

Other changes to the division organization were the addition of the 466th Tank Company (Light), and the expansion of the 466th Field Artillery Battalion into a regiment (and concurrently redesignated the 866th).

The Kansas City units had their training meetings each Tuesday evening for two hours at the Ambassador Hotel or at Fort Leavenworth.

The division, less the 162nd Cavalry Brigade, held consolidated summer training camps for the first two years (1922–23) at Fort Des Moines.

Because of the lack of assigned enlisted personnel, horses, and equipment, the 66th Cavalry Division did not participate as an organized unit in the Fourth Army maneuvers of 1937 and 1940.

However, hundreds of officers and many enlisted men from the 66th participated as umpires or by being assigned to Regular Army or National Guard cavalry units to bring them up to authorized war strength.